How companies managed to keep sailing through turbulence in the first quarter of FY25, which saw two major challenges in the form of general elections and brutal heatwaves in many regions of the country
A worker operates an automatic moulding machine at a plastic product manufacturers factory in New Delhi.
Image: Pradeep Gaur/SOPA Images/LightRocket via Getty Images
Corporate earnings for April to June period are expected to show impacts of severe heatwaves and uncertainties related to general elections. Overall earnings in first quarter of financial year 2025 are likely to show growth at a moderate pace. While oil marketing companies (OMCs) may drag, few sectors like banks and metals may be key earnings drivers.
Even as markets have seen rough patches of volatility in the voting phase from April 19 to June 1 of Lok Sabha elections, equities have made a phenomenal strike with returns, in a way running ahead of fundamentals. The Q1FY25 earnings, therefore, will be a litmus test and an assessment if the super rally is supported by real business growth. In the three months ending June, both benchmark indices Nifty and Sensex gained over 7 percent despite a massive crash of stocks on the day of election results as exit polls predictions did not tally with the actual poll results.